FREQUENTLY ASKED QUESTIONS
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The Village of Port Chester Industrial Development Agency (VPCIDA) is an independent entity working in conjunction with the Village proper as an engine of economic development within the Village of Port Chester. Like other IDAs in New York State, the VPCIDA is a public benefit corporation, which grew out of legislation enacted in 1969 to create economic development in specific localities. There are 109 IDAs in the state. The VPC Board of Trustees serve as the appointing entity and VPCIDA Board members serve at the pleasure of the BOT.
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In simple terms, the mission of the Agency is to promote real property investment in the Village for the purposes of advancing the job opportunities, health, general prosperity, and economic welfare of the people of the Village while improving their recreation opportunities, prosperity and standard of living. It enables investments that are in keeping with Village policy, thus the VPCIDA’s tag line of “Bringing Port Chester’s Vision to Life.”
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The VPCIDA is governed by an all-volunteer seven-member Board of Directors authorized under Article 18-A of the General Municipal Law. The IDA’s day-to-day operations are run by a qualified staff that includes an administrative director, a chief fiscal officer, a secretary/IT officer, and other support staff.
The VPCIDA has put forward its methodologies and procedures in its Uniform Tax Exemption Policy (UTEP) that by law must be published by all IDAs and is updated and amended from time to time to align with the development priorities of the Village of Port Chester. This serves as the PCIDA’s governing document.
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The VPCIDA operates without the use of any public funds. Rather, the IDA uses the fees charged to applicants to run operations and carry out its goals. Every applicant pays a non-refundable fee, and if approved, the appropriate fee by sector or the fee associated with the project’s approved PILOT.
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The VPCIDA is subject to oversight by several institutions including:
• The New York State Authorities Budget Office (ABO) where the mission is to make public authorities more accountable and transparent, and to act in the public interest consistent with their intended purpose,
• Public Authorities Reporting Information System (PARIS) to which all IDAs report to the ABO on a routine basis throughout the year,
• The New York State Comptroller’s Office, which publishes an annual report on IDAs throughout NY State and audits them from time to time.
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IDAs provide four basic forms of financial assistance through tax incentives to qualified applicants to promote the economic welfare, prosperity, and recreational opportunities for residents of a municipality:
• Mortgage recording tax exemption;
• Sales and use tax exemption (as related to the construction and equipping of a project);
• Real property tax abatement provided through a Payment-In-Lieu-Of-Tax Agreement (“PILOT Agreement”) with payment requirements phased into full assessment over the duration of the project term;
• Lower interest rates for tax-exempt bond issuances for qualified projects.
All four tools will be evaluated to assist the VPCIDA in crafting the appropriate incentive package.
These incentives can be provided to the following kinds of qualified projects: industrial, commercial, industrial parks, railroad facilities, waste-disposal facilities, life care, communities, museums, private secondary schools, and hospitals.
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A PILOT, or payment-in-lieu-of-taxes, is a mechanism under which IDAs offer eligible businesses phased-in taxes for a specified period as an incentive to locate in its jurisdiction. It is not a property tax exemption (base taxes are not waived and are required to continue to be paid).
In return for reduced additional taxes, IDAs negotiate payments to be made to the village, school district and county according to a pre-determined schedule in the Agency’s Uniform Tax Exemption Policy. Typically, businesses start by making payments equal to the existing assessed value of the property. Payment on the improvements increase incrementally each year until 100 percent of the assessed value is reached by the end of the PILOT term (typically a discount to full taxes from a 10 to 20-year period). As part of the PILOT, businesses can also seek and receive abatements on mortgage recording tax and sales tax for construction material and equipment.
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The IDA performs an extensive analysis of the project to determine “but for” the IDA’s assistance the project could not be undertaken in the Village. The Uniform Project Evaluation Policy and the Uniform Tax Exemption Policy establish policy guidelines for project evaluation and appropriate incentives. These policies include an extensive application review, cost benefit analysis, compliance with local zoning and planning, and other structured community benefits: including school children mitigation, infrastructure improvements, and other project mitigation priorities.
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Port Chester is a mostly built out community, meaning any development is, redevelopment. Redevelopment in a built-out environment is very expensive and can make a project unviable. Assistance that the IDA is empowered to incentivize a significant upfront investment that can be in part offset over a period of years. Very little high value investment has occurred in the Village over the last several decades without an incentive program.
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No. The existing taxes on a property are frozen in place when an application for assistance is accepted. This is the starting point for any PILOT.
In most cases, companies that receive incentives are building on undeveloped or underutilized parcels that produce minimal taxes. Once the PILOT is negotiated, the company pays the existing tax on the property and provides additional money to the village, school district and county.
When the Village updated its zoning code in 2020 it took precautions to ensure the impacts of development would be fully mitigated. Separate payments are made to mitigate impacts on Traffic, Infrastructure, the Schools, and Stormwater Management, amongst others.
When the impacts of development are anticipated and mitigated, the strategy of incentivizing development with tax abatements does not cost the community but rather unlocks new and additional sources of revenue for the Tax Jurisdictions while inducing new investment. This is a long-term strategy that will increase the assessable tax base in the Village and, over time, minimize the burdens placed on Village properties.
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The VPCIDA conducts an arm’s length financial analysis of a project to satisfy its “But For…” mandate, that a project is not granted incentives unless it is convinced that the project would not be undertaken “But For” the Agency’s assistance.
The VPCIDA maintains a roster of qualified financial analysts who are used on a rotating basis. These analysts vet project information furnished by applicants and provide an opinion to the Agency Board.
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The Steps include the following:
• Potential Applicant meets with IDA Staff.
o Staff vets the potential project in alignment with Village policies.
o Projects that have not gone through the approval process (planning, zoning, BOT) are not allowed to submit applications as the IDA is the last stop.
• Potential applicant appears at an IDA Board meeting to present their project and receive initial Board feedback.
• Potential applicant fills out the VPCIDA Application that Staff reviews for completeness and accuracy.
• If an applicant requests a PILOT (not all do) the project needs to be “qualified” by Staff. It must have minimum attributes as set forth in The IDA Act, Section 874(4) (detailed in the Uniform Project Evaluation Policy AND in the UTEP amendment).
• Potential applicant returns to the IDA thereafter to submit the completed application for financial assistance for the Board’s review and acceptance.
• Once accepted for formal review the Board then begins its due diligence as detailed in its Uniform Project Evaluation Policy. The Application is now published on the IDA’s website as an active project.
• Financial details of the project are submitted to an independent financial consultant, of which the IDA has several on its pre-approved roster, for a thorough, impartial review and opinion as to whether the project could get built without the IDA’s financial assistance. This is the State mandated “But for…..” test.
• If the project meets IDA guidelines and the Board agrees that the project would not get built without benefit, the Board decides on a fixed scale of benefits as outlined in the UTEP.
• It then notices a Public Hearing for the purposes of receiving public comment.
• Pertinent information regarding the project is publicly posted for review, including a cost benefit analysis and the accepted report of the independent financial analyst.
• At the Public Hearing the IDA considers all public comment as it relates to the suitability of the project for benefit.
• After the hearing the IDA Board may take pertinent action granting the proposed scope of benefit.
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Under the VPCIDA’s policy, businesses that receive incentives must agree to create a certain number of jobs, and comply with other local (conditions placed by the BOT, Zoning Board, and/or Planning Commission), and NYS requirements.
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The VPCIDA requires all projects benefiting from PILOTs to annually disclose the number of employees they have hired. The IDA also monitors whether the utilization of benefits given also through required annual reporting.
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A company could lose its tax incentives if it doesn’t comply with VPCIDA policies and job creation requirements.
Pursuant to and in accordance with GML Section 874 (10)-(12), the Agency has established a Project Recapture, Termination and Assignment Policy (the “Recapture Policy”), which governs the Agency’s reserved rights for (i) the review of all project performance measures and the suspension, discontinuance and/or recapture of any Financial Assistance, (ii) the modification of any PILOT Agreement to require increased payments under certain circumstances which may include but shall not be limited to events of material violation of the terms and conditions of any Project Agreement, and (iii) the review and reserved advance approval rights for the transfer of any Project Document, including PILOT Agreements to any successor purchaser or controlling interest in a Project Owner.
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The VPCIDA meets the second Wednesday of every month, generally in the Village Hall 1st Floor Conference Room at 6:30 PM.
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Yes, the VPCIDA’s monthly meetings are open to the public. For meeting schedules and agendas, please go to www.portchesternyida.org.
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Other boards and commissions allow for public comment in the context of applications that are being considered. The VPCIDA does the same. When the VPCIDA considers granting financial assistance to a project, it holds a properly noticed Public Hearing and accepts both written and verbal comment from the public on the topic for consideration by the IDA Board.
Other matters of concern can be brought to the Board’s attention by submitting them to the IDA’s general mailbox: IDAPublicComments@portchesternyida.org. All submissions are included in the Board’s backup packet for the next regularly scheduled meeting of the VPCIDA for the Board’s review and comment. Meeting backup is published on the Civic Clerk portion of the VPCIDA website so the comments will be made available to the public.
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The VPCIDA held a series of such forums in the autumn of 2021. Public and written comments were accepted. These comments were collated by topic and given thorough responses in a published response. As more projects receive their required approvals from the Village, additional public forums can be held to help keep the public informed on the new developments.
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The PCIDA has a separate page addressing School concerns that you may access here.
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The IDA Chamber Of Commerce presentation can be found HERE